FELON-TIF FUNDS-LIQUOR STORE: Are you outraged ?

On Sunday, September 29,2013 , the Chicago Tribune published a front page, above the fold, article on the state of economic development and the quality of life in South Austin. It is an important piece of research and history on Austin.

Blinking beer sign illuminates Austin’s problems Liquor store with ties to felon just the latest problem for a blighted neighborhood that has suffered for decades.

By David Jackson and Gary Marx, Chicago Tribune reporters September 29, 2013

Fed up with package liquor stores marked by street fights and curbside drug dealing, West Side residents more than a decade ago won a moratorium banning new liquor licenses on a bleak stretch of West Madison Street. But in April, a new neon sign for Miller beer blinked in the storefront at 5337 W. Madison St., a block away on either side from two other package liquor outlets.

Authorities knew the Convenience For You store was coming — in fact, city officials gave it $105,000 in tax increment financing grants. Ald. Deborah Graham, 29th, then pushed through a special ordinance lifting the moratorium, saying she wanted to help an African-American businesswoman with stellar credentials.

Actually, the new liquor store was bankrolled and launched by convicted drug dealer Frederick “Juicy” Sims, who has been tied to the Vice Lords street gang, a Tribune investigation found. Now awaiting trial on charges alleging he dealt drugs out of his family home across the alley from the store, Sims has three felony narcotics convictions and a long arrest record. A 1990s police chart lists him as a leader of a Vice Lords faction known as the McNeal family, taken from the maiden name of Sims’ mother.

That City Hall and an alderman would provide crucial backing for a new liquor store despite the vehement opposition of residents is hardly surprising in South Austin, where years of haphazard attempts at development have failed to lift a once-stable community devastated by plummeting property values and vanishing jobs. Here, the city’s planning efforts have yielded a few scattered victories.

Slated to open in October, for example, is a new, 40-unit supportive housing complex for teenage moms. But just as common are dubious successes like the liquor store, or glaring failures — a fast-food restaurant quickly shuttered, a grocery store never built, the Tribune found in an examination of thousands of pages of government records and through months of interviews on the West Side. And even some of the worthiest South Austin projects benefited favored insiders.

TIF rules prohibit liquor stores from getting small business grants, and state and local laws bar felons 1 of 8 9/28/13 12:32 from holding a stake in a liquor store except under rare circumstances. But the new outlet was funded and approved by City Hall agencies that exercised little oversight. Informing Sims he would be getting TIF money, a letter from the Department of Community Development exclaimed: “Thank you for reinvesting in the City of Chicago!”

“It’s disturbing on so many levels,” said nearby resident Serethea Reid, who had implored city officials to reject the store’s license application. “The concentration of liquor stores means more violence, more trash, more police activity. You don’t want kids walking next to a liquor store, and it is not attractive to businesses that might consider locating to the area.” Asked Reid: “Are liquor stores and pawnshops your idea of development?”

In response to Tribune questions, City Hall officials are investigating the store’s ownership. “If a licensee makes false statements in their application, their license is put in jeopardy,” said Jennifer Lipford, spokeswoman for the city Business Affairs Department.

Six months before Graham lifted the moratorium on new licenses and cleared the way for its opening, the store sent her a political contribution, records show. She told the Tribune the money had no impact on her decision, and she said she was not aware of Sims’ involvement in the business or his criminal background. “That’s new information to me,” she said. “If I had known then what I know now, I would not have supported them.”

Development Commissioner Andrew Mooney said City Hall is working to rebuild South Austin and other low-income African-American communities by refurbishing train stations and playgrounds, promoting urban agriculture and improving the city colleges — which he called a key to preparing adults for the workforce and revitalizing the community. Still, Mooney said, areas like South Austin were especially hammered by the 2008 collapse of the housing market and the economic recession, and he cautioned that progress would be slow. “There’s no silver bullet here that I know of or have seen in other cities,” he added. “Until we start seeing a number of things start moving at the national level, not the least of which is the availability of credit, it’s going to be hard in a number of these neighborhoods to move ahead.”

In the meantime, City Hall gave South Austin a new liquor store.

To celebrate its opening in April, Convenience For You posted a photo on Facebook of a near-empty bottle of Remy Martin Louis XIII cognac on a store counter. “A couple shots of Louie to celebrate our hard work!” the caption read. “The bottle is real crystal & the box is real leather. $2200 bottle!!!! We got that!”

Far from downtown Seen from the 5300 block of West Madison Street, the city’s shimmering skyline may as well be Oz. “It’s growing down there, but here, it’s getting worse,” handyman Terrance Ford, 54, said as he surveyed Madison. As Chicago’s more prosperous areas garner public and private investment and build their way out of the recession, South Austin and some other predominantly African-American communities have been falling measurably behind.

Along these streets, teenagers sling heroin and cocaine in broad daylight while a virtual army of men and women scour the alleys for metals to sell at the scrap yards that have cropped up around the community. City workers nail large placards with a red X to structures deemed too dangerous for firefighters and first responders to enter. In a single 1.5-mile-square section of South Austin, Tribune reporters recently counted 165 homes and apartment buildings that were visibly boarded, vacant or unsecured.

Standing on a block of North Leamington Avenue that has four vacant buildings, longtime resident Steven Johnson, 53, said: “It’s like the whole goddamn street going to go down — it’s just a matter of time.” Still, on a recent morning, an elderly woman was quietly raking her lawn next door to a boarded home. Just up the street, a young health care worker in pastel scrubs hurried to catch a bus.

Roomy, elegant homes line the Midway Park corridor, and in a secluded square mile called The Island, neighbors still organize block club events. This has never been a community that lacked for hope, hard work or the will to fight. South Austin’s character was shaped decades ago by waves of blue-collar families who crowded into courtyard apartment buildings and brick row houses.

A gritty-sweet smell of prosperity wafted from the Brach’s candy plant, the M&M Mars factory and Leaf Confectionery Co., where Whoppers malted milk balls were made. Bright storefronts along Madison Street featured cut-rate versions of the latest fashions. Convulsive racial turnover started in the 1960s, as real estate speculators induced frightened whites into selling cheap while luring cash-strapped blacks into “contract purchases” with high interest rates and near-impossible terms. Banks redlined the area and absentee landlords let their properties deteriorate.

When Martin Luther King Jr. was assassinated in 1968, the streets exploded and stores along Madison went up in flames. One by one, the factories began closing, killing off the jobs that had sustained the community for generations. Many who could move did so. From 2000 to 2010, the neighborhood of Austin as a whole shed 19,000 of its 117,500 population. Businesses lost their customer base and closed, further stripping the neighborhood of jobs and shrinking its tax base. Unemployment rose from about 17 percent to 22 percent.

There are no quick fixes for South Austin’s deep social and economic ills, but urban planners say City Hall action is indispensable in communities this distressed. “It’s not really recognized in City Hall or the business community how dramatic the crisis is in some of these neighborhoods. The devastation hasn’t sunk in,” said Jon DeVries, director of Roosevelt University’s Marshall Bennett Institute of Real Estate. “You need a vibrant employment base in the city’s central core combined with systematic investment in the neighborhoods.” That didn’t happen in South Austin.

In 2007, for example, city planning officials published a brochure listing all 112 major developments across Chicago. In all of Austin — the city’s largest and most populous neighborhood — this amounted to a one-time cash grant to a struggling hospital and help for two building short-order restaurants.

One of them was headed by West Side pastor John Abercrombie, who said his fried-fish restaurant at 5148 W. Madison St. would create 40 jobs. The restaurant went belly up, and today it is a vacant cinder-block shell with newspapers taped over the windows. The other project, about a block west, was a pancake house proposed by West Side developer Wafeek Aiyash. It failed, and Aiyash was later convicted of offering to pay a bribe of $100,000 to then-29th Ward Ald. Isaac Carothers for unrelated City Hall favors. Now he’s using the space for a banquet hall.

More recently, TIF money and city land — worth a total of $1.7 million — were earmarked for a Save-A-Lot grocery store, which was to open at 4703 W. Madison in June. The developers walked away, and the site remains a dandelion-studded lot. Now a new business team is proposing an even larger Save-A-Lot a block away, and asking City Hall for $2 million.

“It’s not that the city hasn’t tried. The city has made numerous strategic efforts in South Austin to incentivize the private sector — but the private sector partners have not materialized at the same rate as they have in other communities,” said Peter Strazzabosco, a deputy development commissioner for the city.

But even when compared with other impoverished Chicago communities, Austin for more than a decade has been left out of key neighborhood development programs, including Mayor Rahm Emanuel’s recently announced $330 million Opportunity Planning initiative and the $47 million MacArthur Foundation funded New Communities Program.

City planners and developers privately say they were reluctant to work in South Austin because of its scandal-tainted political leadership and the churning and collapse of its community nonprofits. Elsewhere, coordinated development programs have made measurable gains in low-income neighborhoods.

In Englewood, a long-term strategy is building on a City Hall decision to relocate Kennedy-King College to 63rd and Halsted streets. The construction of a police station, a library and nearby anchors slowly have begun to attract the interest of commercial investors. “With all the issues Englewood faces, there is a coordinated strategy that the city is actually trying to work toward,” said urban planning consultant Leslie Pollock, whose Chicago-based Camiros Ltd. firm advises communities across the country.

“South Austin hasn’t seen a comprehensive approach and that would really be useful.” Commissioner Mooney said South Austin leaders are in a position to benefit from the experiences of neighborhoods that have gotten more government and civic assistance. “What Austin is able to do now is take advantage of what we’ve learned and the tools we have in place … not to mention the learning experience of the other communities,” Mooney said.

Troubled businessman

It was amid South Austin’s turmoil and decline that Frederick Sims managed to stake his own hard-won claim on City Hall’s development opportunities. Not long after dropping out of high school in 1989, Sims was convicted of three separate felony drug cases as he was caught selling and carrying cocaine and heroin on the streets near his home, court records show. Sims was acquitted of murder charges in 1994.

A brick duplex on West Monroe Street that housed at least three generations of the Sims family also was the operating base of the McNeal family faction of the Vice Lords, according to police reports and a Tribune interview with Martise Nunnery, who grew up across the street from Sims and called himself a McNeal family enforcer. “On our block it was Vice Lords, but all the other blocks were Four Corner Hustlers,” said Nunnery, who spoke to reporters from Stateville Correctional Center, where he is serving a 36-year sentence for a murder conviction. Over the years, the McNeal family home and Sims were repeatedly targeted for police raids.

In a 2000 case, Chicago Organized Crime Division detectives got court authorization to tap several telephones used by Sims and his associates, and police recovered weapons and $11,900 in cash when they tried to break up a suspected drug operation. Sims again was acquitted. In August 2012, a police informant told officers he “has never been turned away” when buying heroin from Sims at his home, police reports show. Police obtained a search warrant and found a bundle of $46,908 in cash, a money counter, two digital scales, narcotics packaging materials and a bag of marijuana, records show. Sims has pleaded not guilty to felony possession of 10-30 grams of marijuana with intent to deliver, and he awaits trial.

Sims, meanwhile, was buying and selling property in Chicago and the suburbs. In 2008, he spent $130,000 to buy a closed storefront directly behind the McNeal family home, fronting on Madison Street. He needed no mortgage, as this was a “cash deal,” according to a real estate closing statement obtained by the Tribune. Within months, Sims applied for City Hall funding to renovate the building and open a store that would sell liquor, food, cigarettes and lottery tickets.

A TIF program called the Small Business Improvement Fund was dispensing $750,000 in refurbishment money to businesses along South Austin’s Madison Street corridor. Without a comprehensive communitywide strategy, such funds have become a vehicle for development in South Austin, supporting small, individual projects that contribute little to the neighborhood as a whole, planning experts say. “They don’t have a targeted strategy for South Austin,” said DeVries’ Roosevelt University colleague D. Bradford Hunt, co-author of the book “Planning Chicago.” Instead, Hunt said, “you try these one-off things — a fast-food store, a grocery store, a clinic. But a nice little project here and there without a larger plan is going to lack impact.”

In his 2009 TIF funding application, Sims described himself as “the founder and visionary leader of Convenience For You,” and said his store would be an oasis in the blighted community. “The owner of Convenience For You, Frederick Sims feels the Austin community that he grew up in deserves a convenience store that values their business and treats them with respect,” he wrote. Liquor sales were expected to provide by far the largest percentage of the store’s revenue by product . “We forecast liquor sales to contribute 29 percent of annual gross revenue,” it said on the application. Together, sales of liquor, cigarettes and lottery tickets would account for 60 percent of store revenue. Sims said he was investing $160,000 of his own money in the venture, and would secure another $150,000 from loans and other sources. To boost profits, Sims said in his plan that he would nearly triple the price of basic groceries and goods — a common practice in small stores on the West Side, which is considered a food desert because it has few supermarkets. But markups on alcohol and cigarettes would be minimal. The TIF application form asked whether the owner or any interested party had been convicted of a felony. “NO,” Sims wrote. “Liquor stores” and businesses with “similar uses” are not eligible for the TIF small business grants, according to written program materials. Yet Sims’ application sailed through. In November 2010, city officials notified Sims that Convenience For You had won conditional approval for the first of four city payments that would total $105,000 over the next year. Derek Walvoord, a program director at the nonprofit SomerCor 504, which administers the city’s grant program, issued a brief statement telling the Tribune: “In this instance, when the funds were disbursed, there was no indication that the business would depart from its stated plan to provide basic grocery needs to a commuter-oriented clientele.” Sims still faced one major hurdle. The store needed a liquor license, and Illinois laws and Chicago ordinances almost invariably prohibit felons from having an ownership interest in any store that sells alcohol.

Enter Farrah Mercedes Monroe, a longtime apartment mate of Sims’ sister-in-law who had lived in one of Sims’ suburban homes, government records examined by the Tribune show. Although Sims hadn’t mentioned Monroe in his TIF application, records show she filed the initial 2009 papers with the secretary of state incorporating Convenience For You. Over the next two years, Sims’ and Monroe’s names both appeared on corporate paperwork; once she was listed as Farrah Sims and said her residence was the Sims family home on West Monroe Street. But in December 2011, a month after the final TIF grant payment cleared, Convenience For You filed paperwork with the city Licensing Department removing Sims as an officer. When the store applied to the city for a liquor license, Monroe stated that she was its sole owner and officer. Sims and Monroe declined requests to comment for this story. In her liquor license application, Monroe was required to list “all expenses for the funding of the business,” including costs for startup, construction and renovation. She did not mention the store’s TIF grants or the personal investments Sims had described in his business plan. Monroe, a telephone company billing analyst who declared bankruptcy in 2005, wrote that she was launching the store with $19,000 of her own money, including $10,000 from her 401(k) and $5,000 in personal savings. In February 2012, the store donated $1,950 to Graham’s 29th Ward political fund. It was among the largest single donations she received that year. Six months later, Graham reversed the long-standing moratorium on new liquor licenses in the 5300 block of West Madison Street.

Alderman’s legacy

A lifelong Austin resident, Graham survived homelessness to become a government “relocation specialist” who helped impoverished families facing eviction. Rising through the ranks as a precinct captain in former Ald. Carothers’ ward organization, she narrowly won an Illinois House seat in 2002 after a lengthy primary recount and court battle. While serving as a state representative through 2010, Graham also worked full time at the city Planning Department as a coordinator of special projects. Her combined annual income was more than $140,000. Following Carothers’ bribery and corruption conviction, Mayor Richard M. Daley appointed Graham alderman in 2010. Since then, she has faced vocal community opposition to key development decisions. Last year she provided critical support to a special use zoning permit that enabled a fifth pawnshop to open in a half-mile stretch of North Avenue. Angry residents filed a lawsuit disputing that permit for EZ Pawn at 6432 W. North Ave. They say the collection of pawnshops exploits the poor and is another visible reminder of the area’s economic decay. The local lobbying firm helping EZ Pawn is run by Victor Reyes, a former aide to Daley. It has donated $2,100 to Graham’s ward organization to cover the expenses of community meetings on the issue, according to Graham. Graham said she was trying to help fill a long-vacant storefront — and added that she won concessions from the pawnshop. It will use the name Easy Cash Solutions instead of EZ Pawn, will not sell guns and will not use strobes or garish lighting to attract customers. And it will bring jobs to the ward, she said. Few businesses are as eager to open shop in Austin as pawnshops and liquor stores, Graham said. “Those are the people who are interested in coming.” Still, she said she wants to do more.

“I don’t want my legacy to be defined by the pawnshop, the liquor store, things of that nature,” Graham said. “Moving forward, I certainly want to have the community’s heartbeat in the forefront. … I’ll be listening to the community.” She cited a proposal that would convert an unused factory into a massive aquaponics plant yielding organic vegetables to be sold in the community. Graham also has adopted a plan from local business owners to create an African-American cultural district on West Chicago Avenue — similar to distinctive enclaves such as Boystown, Chinatown and the stretch of Division Street framed by towering Puerto Rican flags.